NZX Limited · NZX:NZX
NZX — Investor Presentation (August 2004)
45 slides from NZX's investor presentation, August 2004
Slide 1: The easy way into the sharemarket
© smartshares The easy way into the sharemarket.
Slide 2: The journey of a thousand miles begins with a single step
“The journey of a thousand miles begins with a single step” Lao Tzu, Chinese Proverb
Slide 3: Parent Company and Fund Manager
Parent Company Fund Manager Funds Management Limited | @ smartshares WIZ yw! * © smarts! nares ZA & The easy way into the sharemarket.
Slide 4: Chairman and Directors
Chairman: Directors: Don Trow Mark Weldon Geoff Brown Martin Rea
Slide 5: TENZ, MIDZ, MOZY, FONZ
© smartshares TENZ J MIDZ J MOZY J FONZ smartshares ‘The exsy way into the sharemarket.
Slide 6: What are ETFs?
What are ETFs? ETFs trade like normal shares They ‘track’ an index by holding shares in proportion to the index A single share buys multiple securities
Slide 7: Worldwide Growth of ETFs
Worldwide Growth of ETFs Source: Morgan Stanley. As at June 2004
Slide 8: Main global managers of ETFs
Main global managers of ETFs Source: Bloomberg Markets, 2004
Slide 9: Most popular international ETFs
Most popular international ETFs
Slide 10: The best way to own common stocks is through an index fund
“The best way to own common stocks is through an index fund” Warren Buffett
Slide 11: Most of the mutual investments I have are index funds
“Most of the mutual investments I have are index funds, approximately 75%” Charles Schwab
Slide 12: Great rewards grow from small differences in cost
“Great rewards grow from small differences in cost ” John C. Bogle Founder of the Vanguard Group
Slide 13: New Zealand market performance
New Zealand market performance
Slide 14: New Zealand market performance
New Zealand market performance
Slide 15: Ownership Structure of the New Zealand Market
Ownership Structure of the New Zealand Market
Slide 16: Fear is the barrier to entry for most retail investors
Fear is the barrier to entry for most retail investors “My knowledge base just isn’t that great” “I lack education and time” “I don't know enough about the stock market and I could lose all my money” “Ignorance and fear keeps me away” “Thought about investing, but never really actioned it” Source: N
Slide 17: Role of NZX Funds Management
Role of NZX Funds Management New Zealand lags the world in this space Research proves there is a product gap Smartshares is the bridge; We want to lead the way for New Zealanders to come back to the market
Slide 18: What Smartshares delivers: Investing, smart and easy
What Smartshares delivers: Investing, smart and easy.
Slide 19: Geoff Brown, Director, NZX Funds Management
Geoff Brown Director, NZX Funds Management
Slide 20: Benefits of investing with ETFs
Benefits of investing with ETFs
Slide 21: I would rather be certain of a good return
“I would rather be certain of a good return, than hopeful of a great one” Warren Buffet
Slide 22: Reduces your risk
Reduces your risk One share covers multiple companies Fits with every investors’ needs
Slide 23: Hebner: 12-Step Program to Index Funds
Source: Hebner, M. T. (2004). 12-Step Program to Index Funds
Slide 24: Mutual funds outpacing a market index quote
“Any chance that mutual funds as a group could out pace a suitably weighted market index is, simply put, gone with the wind” John C Bogle, Founder Vanguard Group
Slide 25: Best performing investment class
Best performing investment class Over the last 70 years, New Zealand equities have outperformed all other investments Buy into the performance of the market Index funds outperform the majority of managed funds over time
Slide 26: Effect of higher costs (Vanguard Group)
*Assumes 2% per year higher costs Source: Vanguard Group
Slide 27: Liquidity, Immediacy, Transparency, Certainty
Liquidity Immediacy Transparency Certainty
Slide 28: Low fees drive investment performance
Low fees drive investment performance ETFs have very low fees Managed funds are generally twice as expensive
Slide 29: The effect of 1% higher costs on your investment
The effect of 1% higher costs on your investment Ø Start with $10,000 Ø Hold for 20 years Ø Assume 10% return (excluding tax) Ø Returns are reinvested After 20 years, a 1% difference in fees has a 22% difference in returns
Slide 30: Nothing is certain but death and taxes
“Nothing is certain but death and taxes” Benjamin Franklin
Slide 31: Binding ruling from the IRD
Binding ruling from the IRD No tax on share price gains More cash in pocket
Slide 32: Benefits for Investors
Benefits for Investors Easy concept to understand Easy product to trade All the benefits of a fund with the flexibility of a share
Slide 33: Benefits for Advisors
Benefits for Advisors Easy way to get new clients into low-cost investments Extend your business model Little research required, minimum ongoing client maintenance
Slide 34: TENZ, MIDZ, MOZY, FONZ
© smartshares TENZ J MIDZ J MOZY J FONZ smartshares ‘The exsy way into the sharemarket.
Slide 35: TENZ NZSX Fund
eee TENZ NZsxX 10 Fund —- Fund Details +—— Index: NZSX10 3100 , Code: TNZ Size: $84m 2900 Price: $1.14 2700 Key Statistics 2500 Gross Return: 26.1% Gross Div Yield: 5.6% 2300 Liquidity: 24.5% 2100 — 1900 — 1700 1500 LE 4 June-99 oo 01 02 03 04
Slide 36: MIDZ NZSX MidCap Index
nnn -MIDZ_ Nzsx MidCap Index —- Fund Details ;—— Index: NZSX MidCap 6000 Code: MDZ Size: $38m 5500 Price: $2.21 5000 Key Statistics 4500 Gross Return: 27.6% Gross Div Yield: 14.2% 4000 Liquidity: 24.9% 3500 _— 3000 aa) 2500 2000 4 | Feb-99 00 01 02 03 04
Slide 37: Smartshares: The easy way into the sharemarket
x) smartshares The easy way into the sharemarket. C3) smartshares The easy way into the sharemarket.
Slide 38: Intended IPO Facts
Intended IPO Facts Index: S&P/ASX MidCap 50 Index IPO Open: 23 August 2004 IPO Close: 17 September 2004 Fund Goal: $40m+ Roadshow: Main centres in NZ, 25 Aug – 3 September
Slide 39: Intended IPO Facts
Intended IPO Facts Index: NZSX 50 Portfolio Expected IPO Open: November 2004
Slide 40: Smartshares: The easy way into the sharemarket
x) smartshares The easy way into the sharemarket. C3) smartshares The easy way into the sharemarket.
Slide 41: How very Smartshares (crossword advertisement)
Across: 1. It sits on your lap and purrs. (3) How very Smartshares. Investing is simple with Smartshares, anew range of Exchange Traded Funds from NZX Funds Management. You can start with as little as $1,000 and because your money is automatically spread across multiple shares, you're not putting al
Slide 42: How very Smartshares (join the dots advertisement)
How very Smartshares. Investing is simple with Smartshares, Join the dots to reveal the shape. anew range of Exchange Traded Funds from NZX Funds Management. You can start with as little as $1,000 and because your money is automatically spread across multiple shares, you're not putting all your fina
Slide 43: How very Smartshares
How very Smartshares. Investing is simple with Smartshares, a new range of Exchange Traded Funds from NZX Funds Management. You can start with as little as $1,000 and because your money is automatically spread across multiple shares, you're not putting all your financial eggs into one basket. It’s t
Slide 44: MOZY: invest in Australia
kj MOZY QUEENSLAND VICTORIA WESTERN AUSTRALIA TASMANIA If you want to invest in Australia, there's no place like home.
Slide 45: www.smartshares.nzx.com
© smartshares The easy way into the sharemarket. www-.sinartshares.nzx.com C3) smartshares ‘The exsy way into the sharemarket.